Corn grinds lower, soybeans see supply problems, wheat slips

Corn: As it stands right now, we have to continue looking for a grind until news comes up that can scare this market into a bounce again. Bulls can hope for some supportive news from the USDA on the March crop report, but that is still two weeks from this Friday. After that, the next potential USDA help would be the acreage report at the end of March. This is why we continue to look for a grind lower long term, at least for the next month. Right now it appears safer to assume a grind lower while looking out for reasons to warrant a bounce…Ryan Ettner

Soybeans: If China starts to be a more aggressive buyer of old crop beans it would definitely get the market’s attention as the U.S. does not much inventory left to sell. With South American dock workers threatening to strike and logistical issues leading to 100+ day delays in loadings, there is a really good chance the U.S. could sell China some beans if the price is right. Beans settled 67 ¾ cents off of Friday highs based on the May contract. The closer the market gets to the $14.00 level, the odds increase that China will be back into our market.

Argentina received some much needed rain over the weekend and that seems to have taken the bullish weather spin away from the market. First notice day for the March contacts is Thursday. We have been recommending producers to be out of old crop inventory (excluding gambling bushels) by the time South America’s harvest is in full swing (which is coming on fast). Brazil is reported to be 30% harvested. Major resistance is at the $15.00 level. If the market rallies back to tense levels producers need to take advantage of the move and sell more of their inventory…Jim McCormick

Wheat: Demand is continuing to fall behind trade's expectations and we continue to see the funds push wheat lower by adding shorts. Weekly export sales have been trending better as the US is cheapest best quality store on the market. Wheat harvest is pretty much complete in Argentina but we do not suspect this to take away from U.S. export prospects.

China January wheat imports were 179,356 tonnes down 15.6% year over year. Russian grain intervention tenders are alleviate wheat prices in Russia. Weather is going to be more of a fact as we move towards spring. After the weather system that will be moving through the plains today and moving east tomorrow the forecast does turn drier. This could slow the slide on wheat but doesn’t totally change the story that we are not at a tight condition for wheat.

Continue to look for this market to slide lower as we are trending down and funds continue to push things down…Cordon Sroka

About the Author

Ryan Ettner is a registered commodities broker and grains analyst at Allendale, Inc. Steve Georgy is a Sr. Broker/Manager at Allendale, Inc. Jim McCormick is Senior Broker/Manager at Allendale, Inc. Allendale is registered with the CFTC and NFA and is a member of the NIBA. www.allendale-inc.com